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G U I D E T O F A M I LY F I N A N C E

Elder Marvin J. Ashton


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for t he G U I D E T O F A M I L Y F I N A N C E

E lde r Marv in J . Ashton

Published by

The Church of Jesus Christ of Latter-day Saints

Salt Lake City, Utah


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© 1992, 2006 by Intellectual Reserve, Inc.

All rights reserved

Printed in the United States of America

English approval: 1/06


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iii

In the welfare session of the April 1975 general conference, ElderMarvin J. Ashton, a member of the Council of the Twelve, deliv-ered the address from which this booklet is adapted. President

Spencer W. Kimball endorsed Elder Ashton’s message when in thesame meeting he stood and said:

“I have been thinking of many things since

we came to this meeting. I endorse what

Brother Ashton has said. I think if I were

starting with a young family, I would want

to get the twelve points explained by Brother

Ashton and follow them explicitly myself

and teach my children and my family and

everybody with whom I came in contact. It

is basic. All my life from childhood I have

heard the Brethren saying, ‘Get out of debt

and stay out of debt.’ I was employed for

some years in the banks and I saw the terri-

ble situation that many people were in because they had ignored

that important counsel.

“I agree with all that Brother Ashton has said . . . with regard to

family financing in the home. Every family should have a budget.

Why, we would not think of going one day without a budget in

this Church or our businesses. We have to know approximately

what we may receive, and we certainly must know what we aregoing to spend. And one of the successes of the Church would have

to be that the Brethren watch these things very carefully, and we

do not spend that which we do not have.”

Elder Marvin J. Ashton


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T he wind and waves will periodically interfere with our chosen

course, even in financial matters;

but the laws of the gospel can bring usback on course and guide us

to peaceful waters.

ELDER M ARVIN J. A SHTON


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Recently I had the opportunity to visit with a choice youngcouple. They were to be married within the week. Their eyessparkled in anticipation of the important event and with evidence

of their continuing love for one another. Both had the advantagesof college education, good homes, and cultural experiences. It

was delightful to share their personalities, plans, and potentials.

Their courtship already seemed appropriately launched on an

eternal basis.

During our interview, their responses to

only one question gave me concern. I

hope my anxieties and suggestions

caused them to reassess their pending

partnership.

To the question, “Who is going to man-

age the money in your marriage?” she

replied, “He is, I guess.” He responded,

“We haven’t talked about that yet.” Thesecomments surprised and shocked me.

How important are money manage-

ment and finances in marriage and family affairs? May I

respond, “Tremendously.” The American Bar Association has

indicated that 89 percent of all divorces can be traced to quar-

rels and accusations over money. Others have estimated that 75

percent of all divorces result from clashes over finances. Someprofessional counselors indicate that four out of five families

are strapped with serious money problems.

May I at this time hasten to emphasize the fact that these marriage

tragedies are not caused simply by lack of money, but rather by

the mismanagement of personal finances. A prospective wife could

well concern herself not with the amount her husband-to-be can

earn in a month, but rather with how he (and she) will manage

the money that comes into their hands. Money management

should take precedence over money productivity. A prospective

husband who is engaged to a sweetheart who has everything

THE AMERICAN BAR

ASSOCIATION HAS

INDICATED THAT

89 PERCENT OF ALL

DIVORCES CAN BE

TRACED TO QUARRELS

AND ACCUSATIONS

OVER MONEY.


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would do well to take yet another look and see if she has money-

management sense.

In the home, money management between husband and wife

should be on a partnership basis, with both parties having a voice

in decision- and policy-making. When children come along and

reach the age of accountability, they too should be involved in

money concerns on a limited partnership basis. Peace, content-

ment, love, and security in the home are not possible when finan-

cial anxieties and bickerings prevail. Whether we are anticipating

marriage or are well into it, today is the time for all of us to review

and repent as necessary to improve our money management skillsand live within our means.

As proper money management and living within one’s means are

essential in today’s world if we are to live abundantly and happi-

ly, may I make some recommendations for improved personal and

family financial management. The following twelve points will

help each of us achieve this goal, I believe.


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1 . P A Y A N H O N E S T T I T H I N G

Successful financial management in every LDS home begins with

the payment of an honest tithe. If our tithing and fast offerings are

the first obligations met following the receipt of each paycheck,

our commitment to this important gospel principle will be

strengthened and the likelihood of financial mismanagement will

be reduced. Paying tithing promptly to Him who does not come to

check up each month will teach us and

our children to be more honest with

those physically closer at hand.

2 . L E A R N T O M A N A G E M O N E Y

B E F O R E I T M A N A G E S Y O U

A bride-to-be would do well to ask her-

self, “Can my sweetheart manage money?

Does he know how to live within his

means?” These are more important ques-tions than, “Can he earn a lot of money?”

Financial peace of mind is not determined by how much we make,

but is dependent upon how much we spend.

New attitudes and relationships toward money should be devel-

oped constantly by all couples. After all, the partnership should be

full and eternal. Management of family finances should be mutu-

al between husband and wife in an attitude of openness and trust.

Control of the money by one spouse as a source of power and

authority causes inequality in the marriage and is inappropriate.

Conversely, if a marriage partner voluntarily removes himself or

herself entirely from family financial management, that is an abdi-

cation of necessary responsibility.

FINANCIAL PEACE

OF MIND IS NOT

DETERMINED BY HOW

MUCH WE MAKE,

BUT IS DEPENDENT

UPON HOW MUCH

WE SPEND.


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33 . L E A R N S E L F - D I S C I P L I N E A N DS E L F - R E S T R A I N T I N M O N E Y M AT T E R S

Learning how to discipline oneself and exercise constraint where

money is concerned can be more important than courses in account-

ing. Young couples should recognize that they cannot immediately

maintain the same spending patterns and life-style as that to which

they were accustomed as part of their parents’ family. Married cou-

ples show genuine maturity when they think of their partner’s and

their family’s needs ahead of their own spending impulses. Money

management skills should be learned

together in a spirit of cooperation andlove on a continuing basis. A disgusted

husband once said, “I think that in life

money talks, but when my wife gets

hold of it, all it ever says is ‘good-bye.’ ”

To the husband who says his wife is the

poorest money manager in the world, I

would say, “Look in the mirror and meetthe world’s poorest teacher-trainer.”

We live in a self-indulgent, me-oriented,

materialistic society. Advertisements

entice young buyers by demonstrating

how easy it is to get credit and buy on time. Interestingly, no ads

focus on the glamour of paying the money back, nor do they men-

tion how long or hard it is to do just that—especially with the

unavoidable interest added on.

MARRIED COUPLES

SHOW GENUINE

MATURITY WHEN THEY

THINK OF THEIR

PARTNER’S AND THEIR

FAMILY’S NEEDS

AHEAD OF THEIR OWN

SPENDING IMPULSES.


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Mar.

Apr.

May

June

July

Aug.Sept.

Oct.

Nov.

Dec.

Jan.

Feb.

Mar.

Credit

Card

110

110

110

110

Furniture

70

70

70

70

180.

180.

180.

Dentist

50

50

50

50

50

50

50

.230.

.230.

Physician

75

75

75

75

75

7575

75

75

.305.

.305.

Auto

Loan

235

235

235

235

235

235235

235

235

235

235

.540.

D E B T - E L I M I N A T I O N C A L E N D A R

A debt-elimination calendar can help you reduce or eliminate debt. Mark off sev-

eral columns on a piece of paper. In the first column on the left, write the names

of the months, beginning with the upcoming month. At the top of the next column,

write the name of the creditor you want to pay off first. It may be the debt with the

highest interest rate, or the earliest pay-off date. List the monthly payment for that

creditor until the loan is repaid as shown in the illustration above. At the top of the

next column, record the name of the second creditor you want to repay, and list

payments due each month. After you have repaid the first creditor, add the amount

of that monthly payment to your payment to the second creditor. (In the example

above, notice that the family finished making monthly payments on their credit

card. They then added $110 to the $70 furniture payment, creating a new monthly

payment of $180.) Continue the process until all loans are repaid.


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44 . U S E A B U D G E TEvery family must have a predetermined understanding of how

much money will be available each month and the amount to be

spent in each category of the family budget. Checkbooks facilitate

family cash management and record-keeping. Carefully record

each check when written and balance the checkbook with the

monthly bank statement.

With the exception of buying a home, paying for education, or mak-

ing other vital investments, avoid debt and the resulting finance

charges. Buy consumer durables and

vacations with cash. Avoid installment

credit, and be careful with your use of

credit cards. They are principally for

convenience and identification and

should not be used carelessly or reck-

lessly. The use of multiple credit cards

significantly adds to the risk of excess

debt. Buy used items until you have

saved sufficiently to purchase quality

new items. Purchasing poor-quality

merchandise almost always ends up

being very expensive.

Save and invest a specific percentage of your income. Liquid sav-

ings available for emergencies should be sufficient to cover at leastthree months of all essential family obligations. Every LDS family

should file honest and timely tax returns.

Please listen carefully to this—and if it makes some of you feel

uncomfortable, it is on purpose: Latter-day Saints who ignore or

avoid their creditors are entitled to feel the inner frustrations that

such conduct merits, and they are not living as Latter-day Saints

should! Bankruptcy should be avoided, except only under the most

unique and irreversible circumstances, and then utilized only after

prayerful thought and thorough legal and financial consultation.

LIQUID SAVINGS

AVAILABLE FOR

EMERGENCIES SHOULD

BE SUFFICIENT TO

COVER AT LEAST THREE

MONTHS OF ALL

ESSENTIAL FAMILY

OBLIGATIONS.


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INCOME PLANNED ACTUAL

Wages/Salaries (after taxes)

Other income

Total income

EXPENDITURES PLANNED ACTUAL

Church donationsSavings

Food

Mortgage or rent

Utilities

Transportation

Debt payments

Insurance

Medical

Clothing

Other

Total expenditures

Income less expenditures

B U D G E T F O R 2 0

• A budget helps you plan and evaluate your expenditures.

• Budget for a specified period (such as weekly, biweekly, monthly), according to

your pay schedule.

• Balance income with expenditures, and spend less than you earn.


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5 . T E A C H F A M I L Y M E M B E R S E A R L Y T H E

I M P O R TA N C E O F W O R K I N G A N D E A R N I N G

“In the sweat of thy face shalt thou eat bread” is not outdated

counsel. It is basic to personal welfare. One of the greatest favors

parents can do for their children is to teach them to work. Much

has been said over the years about children and monthly

allowances, and opinions and recommendations vary greatly. I’m

from the “old school.” I believe children should earn their money

needs through service and appropriate chores. Some financial

rewards to children may also be tied to educational effort and the

accomplishment of other worthwhile goals. I think it is unfortu-nate for a child to grow up in a home where the seed is planted in

the child’s mind that there is a family

money tree that automatically drops “green

stuff” once a week or once a month.

6 . T E A C H C H I L D R E N T O M A K E M O N E Y

D E C I S I O N S I N K E E P I N G W I T H T H E I R

C A P A C I T I E S T O C O M P R E H E N D

Based upon appropriate teaching and indi-

vidual experience, children should be

responsible for the financial decisions affect-

ing their own money and suffer the consequences of unwise

spending. “Save your money” is a hollow pronouncement from aparent to a child. “Save your money for a mission, bicycle, doll

house, trousseau, or car” makes understandable sense. Family

unity comes from saving together for a common, jointly approved

purpose. In our home we found it unifying to have a child save for

a major project; then, when the amount was achieved, we matched

it with a predetermined percentage. Incentives are a powerful force

in motivating and achieving desired behavior.

FAMILY UNITY

COMES FROM

SAVING TOGETHER

FOR A COMMON,

JOINTLY APPROVED

PURPOSE.


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7 . T E A C H E A C H F A M I LY M E M B E R T O

C O N T R I B U T E T O T H E T O T A L F A M I L Y W E L F A R E

As children mature, they should understand the family financial

position, budget and investment goals, and their individual respon-

sibility within the family. Encourage inexpensive fun projects,

understandable to the children, that contribute to a family goal or

joy. Some families miss a tremendous financial and spiritual expe-

rience when they fail to sit together, preferably during family home

evening, and each put in his share of the monthly amount going to

the son or daughter, brother or sister, who is serving in the mission

field. When this monthly activity is engaged in all at once, he or she becomes “our” missionary, with pride becoming a two-way street.

8 . M A K E E D U C A T I O N A C O N T I N U I N G

P R O C E S S

Complete as much formal, full-time educa-

tion as possible, including trade schools andapprentice programs. This is money well

invested. Based on potential lifetime earnings,

the hours spent in furthering your education

will be very valuable indeed. Use night school

and correspondence classes to further prepare.

Acquire some special skill or ability that could

be used to avoid prolonged unemployment.The ability to do basic home and auto repairs can frequently be help-

ful, as well as a source of family savings. Periods of unexpected

unemployment can happen to anyone. We should not allow our-

selves, when we are out of work, to sit back and wait for “our type

of job” if other honorable interim employment becomes available.

9 . W O R K T O W A R D H O M E O W N E R S H I P

Home ownership qualifies as an investment, not consumption. Buy

the type of home your income will support. Improve the home and

beautify the landscape throughout the period you occupy the


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premises so that if you do sell it, you can use the accumulated equi-

ty and potential capital gain to acquire a home more suitable to

family needs.

1 0 . A P P R O P R I A T E L Y I N V O L V E Y O U R S E L F

I N A N I N S U R A N C E P R O G R A M

It is most important to have sufficient medical, automobile, and

homeowner’s insurance and an adequate life insurance program.

Costs associated with illness, accident, and

death may be so large that uninsured families

can be financially burdened for many years.

1 1 . U N D E R S T A N D T H E I N F L U E N C E

O F E X T E R N A L F O R C E S O N F A M I LY

F I N A N C E S A N D I N V E S T M E N T S

Inflation continues to offset a major portion

of average wage increases. A larger pay-check may not mean more purchasing

power and should not be an excuse for

extravagant purchases or additional debt.

Beyond the emergency liquid savings, families should plan for and

utilize a wise investment program preparing for financial securi-

ty, possible disability, and retirement. Avoid all proposals for

high-risk investments and get-rich-quick schemes.

1 2 . A P P R O P R I A T E LY I N V O L V E Y O U R S E L F I N A F O O D

S TO RA GE A ND E ME RG EN CY P RE PA RE DN ES S P RO GR AM

Accumulate your basic food storage and emergency supplies in a

systematic and orderly way. Avoid going into debt for these pur-

poses. Beware of unwise food storage promotional schemes.Planting and harvesting a garden annually is helpful to the fami-

ly in many ways, including the food budget. Eat nutritious foods

and exercise appropriately to improve health, thus avoiding many

medical costs.


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These few points and suggestions are not intended to be all-inclusive or exhaustive. Rather, it is hoped that a need has been brought to the surface for our serious consideration. Weneed to recognize and be aware of these basic guidelines for wise

money management.

God help us to realize that money management is an important

ingredient in proper personal welfare. Learning to live within our

means should be a continuing process. We need to work con-

stantly toward keeping ourselves free of financial difficulties. It is

a happy day financially when time and interest are working for

you and not against you.

Money in the lives of Latter-day Saints should be used as a means

of achieving eternal happiness. Careless and selfish uses cause us

to live in financial bondage. We can’t afford to neglect personal

and family involvement in our money management. God will

open the windows of heaven to us in these matters if we will butlive close to him and keep his commandments.


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A debt-elimination calendar can help you reduce or eliminate debt. Mark off sev-

eral columns on a piece of paper. In the first column on the left, write the names

of the months, beginning with the upcoming month. At the top of the next column,

write the name of the creditor you want to pay off first. It may be the debt with the

highest interest rate, or the earliest pay-off date. List the monthly payment for that

creditor until the loan is repaid. At the top of the next column, record the name of

the second creditor you want to repay, and list payments due each month. After

you have repaid the first creditor, add the amount of that monthly payment to your

payment to the second creditor. Continue the process until all loans are repaid.

Month

_________

_________

_________

_________

_________

_________

_________

_________

_________

_________

_________

_________

Debt 1

_________

_________

_________

_________

_________

_________

_________

_________

_________

_________

_________

_________

Debt 2

_________

_________

_________

_________

_________

_________

_________

_________

_________

_________

_________

_________

Debt 3

_________

_________

_________

_________

_________

_________

_________

_________

_________

_________

_________

_________

Debt 4

_________

_________

_________

_________

_________

_________

_________

_________

_________

_________

_________

_________

Debt 5

_________

_________

_________

_________

_________

_________

_________

_________

_________

_________

_________

_________

D E B T - E L I M I N A T I O N C A L E N D A R


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